Cryptocurrency Market Surges: A Look at XRP, Dogecoin, and Bitcoin
The cryptocurrency market recently reached a groundbreaking valuation of $3.8 trillion, largely influenced by former President Trump’s reelection success on November 5. This political shift has sparked excitement across major cryptocurrencies and meme tokens alike.
Many investors anticipate that Trump’s administration will adopt a friendlier regulatory approach towards the crypto industry. This optimism is further buoyed by Trump’s nomination of Paul Atkins, a pro-crypto businessman, to head the Securities and Exchange Commission (SEC). However, Atkins still needs Senate confirmation.
Since November 5, XRP (CRYPTO: XRP) has surged by 362%, Dogecoin (CRYPTO: DOGE) has gained 139%, while Bitcoin (CRYPTO: BTC) has risen by 41%. As we approach 2025, which cryptocurrency will prove to be the best investment?
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Exploring the Potential of XRP
Created in 2012 by Ripple, XRP is part of a payment network known as RippleNet, designed to facilitate quick international money transfers for banks and financial firms. The use of XRP standardizes these payments, allowing a U.S. bank to transfer funds to a German bank in seconds, avoiding costly currency-exchange fees.
However, in 2020, the SEC filed a lawsuit against Ripple, asserting that XRP is a security and should be regulated as such. This has cast uncertainty over the cryptocurrency’s future. Unlike Bitcoin, which is not affiliated with a specific company, XRP’s fate is tied to Ripple’s operations.
In August 2024, the lawsuit reached a partial resolution, with Ripple fined $125 million. A judge determined that XRP could be considered a security only in certain situations, providing relief for investors and contributing to its recent price surge. Despite the SEC’s ongoing appeal, optimism abounds that Trump’s SEC pick will stabilize the regulatory landscape.
Currently trading at $2.31, XRP has not yet reached its previous high of $3.40 set in 2018, indicating potential for growth.
Dogecoin’s Revival
Tesla’s CEO Elon Musk, a key supporter of Trump, has also been influential in the rise of Dogecoin. In 2021, he dubbed it his favorite cryptocurrency and promoted it widely on social media, including a notable appearance on Saturday Night Live. Following Trump’s recent election triumph, Musk was appointed head of an entity humorously named the “Department of Government Efficiency,” or DOGE.
Despite its impressive gains post-November 5, Dogecoin remains priced at $0.39—far below its all-time high of $0.73 hit during Musk’s SNL appearance in May 2021. After that peak, Dogecoin’s value plummeted by 92% as it became evident that Musk did not have sustainable strategies to support the token’s value.
This recent rally resembles its 2021 surge, leading some to question its long-term potential. Since Dogecoin was initially created as a joke in 2013, its ability to maintain lasting value is uncertain.
Bitcoin: The Leader of the Pack
As the largest cryptocurrency, Bitcoin has a market cap of $1.9 trillion, accounting for more than half of the entire crypto market. While its recent 41% increase is modest compared to XRP and Dogecoin, Bitcoin has recently achieved a new record high of over $100,000 per coin.
Unlike many cryptocurrencies, Bitcoin is gradually gaining regulatory approval. The SEC has authorized several crypto-based exchange-traded funds (ETFs) this year, providing a safer investment route for institutional players. Bitcoin ETFs have collectively attracted over $100 billion in inflows, demonstrating significant market demand.
Ambitious predictions for Bitcoin’s price are emerging; Cathie Wood from Ark Investment Management envisions it could hit nearly $1.5 million per coin by 2030. This speculation is based on factors like institutional adoption and a growing recognition of Bitcoin as “digital gold.”
To match the $18.4 trillion value of all above-ground gold reserves, Bitcoin’s market cap would need to increase by 863%, suggesting a potential price target of approximately $929,000, provided it garners widespread acceptance.
Final Thoughts
Ripple offers an innovative payment solution, but it faces competition, as banks can utilize RippleNet with regular currencies, which may limit XRP’s growth. Although regulatory clarity could enhance XRP’s value, its all-time high remains unrecaptured, raising questions about its role as a reliable store of value.
Bitcoin, on the other hand, is evolving into a legitimate store of value thanks to rising prices and increasing acceptance. This trend positions Bitcoin as a stronger candidate for long-term investments compared to XRP or Dogecoin.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
